SCI Judgements

H.P. State Forest Company Ltd. v. M/s. United India Insurance Co. Ltd. CIVIL APPEAL NO. 6347 OF 2000 decided by DALVEER BHANDARI & HARJIT SINGH BEDI, JJ. on December 18, 2008. The Court has discussed the law on restraint of legal proceedings as contained in Section 28 of the Indian Contract Act, 1872. The relevant clause in the insurance contract that was alleged to have been in restraint of legal proceedings was:

6(ii) In no case whatsoever shall the company be liable for any loss or damage after the expiration of 12 months from the happening of the loss or damage unless the claim is the subject of pending actionor arbitration: it being expressly agreedand declared that if the company shalldeclaim liability for any claim hereunderand such claim shall not within 12calendar months from the date of thedisclaimer have been made the subjectmatter of a suit in a court of law then theclaim shall for all purposes be deemed tohave been abandoned and shall notthereafter be recoverable hereunder.

The Court held:

The clause before this Court in Food Corpn.case... can instantly becompared with the clause in the present case. The contract in that case said that the right shall stand extinguished after six months from the terminationof the contract. The clause was found valid because it did not proceed to say that to keep the right alive the suit was also required to be filed within six months. Accordingly, it was interpreted to mean that the right was required to be asserted during that period by making a claim to the Insurance Company. It was therefore held that the clause extinguished theright itself and was therefore not hit by Section 28 ofthe Contract Act. Such clauses are generally found ininsurance contracts for the reason that undue delayin preferring a claim may open up possibilities offalse claims which may be difficult of verification withreasonable exactitude since memories may havefaded by then and even ground situation may have changed. Lapse of time in such cases may prove to be quite costly to the insurer and therefore it wouldnot be surprising that the insurer would insist that if the claim is not made within a stipulated period, theright itself would stand extinguished. Such a clause would not be hit by Section 28 of the Contract Act.

C.R. Jayaraman & Ors. v. M. Palaniappan & Ors. CIVIL APPEAL NO. 993 OF 2002 decided by Tarun Chatterjee & Aftab Alam, JJ. on December 18, 2008 dealt with the question as to whether a temple was a private or public temple

Shanti Bhushan and Anr. v. Union of India and Anr. WRIT PETITION (CIVIL) NO. 375 OF 2007 decided by Dr. ARIJIT PASAYAT & Dr. MUKUNDAKAM SHARMA, JJ. on December 18, 2008 was a petition under Article 32 of the Constitution seeking appropriate declaration and issuance of a writ of quo warranto or any other writ or direction quashing the appointment of respondent No.2 ("R-2) as a Judge of the Madras High Court.

The allegation of the Petitioners was that R-2 was not appointed as a Permanent Judge by following the norms and such appointment is in violation of the law as declared by this Court in Supreme Court Advocates- on-Record Association & Ors. v. Union of India (1993 (4) SCC 441) and Special Reference No.1 of 1998 (1998 (7) SCC 739). The Petitioners contended that the opinion of the Chief Justice of India has to be formed collectively after taking into account the views of his senior colleagues and other Judges of the Supreme Court conversant with the affairs of the concerned High Court who are required to be consulted by him for the formation of opinion and no appointment can be made unless it is in conformity with the final opinion of the Chief Justice of India formed in the aforesaid manner.

The Counsel for Union of India argued that "more than 350 Additional Judges have been appointed as permanent Judges during the period from 1.1.1999 to 31.7.2007 by successive Chief Justice of India who had not consulted the Collegium while considering the cases of appointment of Additional Judges as Permanent Judges of the High Courts although the collegium was consulted at the stage of initial appointment as Additional Judge." It was further submitted that once the Government was satisfied that a suitable candidate was in fact appointed as an Additional Judge of the High Court, elaborate consultations as required for forming the opinion for appointment of an Additional Judge may not have considered necessary while considering the case for appointment as permanent Judge.

Further, it was argued that "in Advocates-on-Records Association's case (supra) in paras 466, 467 and 468 this Court had observed that though some aspects in S.P. Gupta v. Union of India and Anr. (1981 (Supp) SCC 87) have the approval of the larger Bench, yet the Executive itself has understood the correct procedure notwithstanding S.P. Gupta's case and there is no reason to depart from it when it is in consonance with the concept of the independence of the judiciary. Consequent to the judgment in Advocates-on-Record Association's case (supra) the memorandum of procedure was revised vide D.O. No.K-11017/9/93-US.11 dated 9.6.1994. Subsequently, on the basis of the opinion in Special Reference No.1/1998 the revised procedure was prescribed by Reference No.K-110017/13/98-U.S II dated 30.6.1999. Paras 11, 12, 13, 14, 15, 16, 17, 18 and 19 pertain to appointment of permanent Judges. It is therefore submitted that there is no infirmity in the appointment of respondent No.2 as a Permanent Judge. "

Finally, it was contended: "On true interpretation of Article 224(1) of the Constitution it can be said that Additional Judges are not intended to be re-appointed out of turn. It is submitted that on expiry of the term as an Additional Judge, he or she is entitled to be considered for appointment as a Permanent Judge. But in either case the procedure under Article 217(1) of the Constitution has to be repeated. An additional Judge who had worked for a period of his tenure has a weightage in his favour compared to a fresh appointee and any process of appointment while filling in a vacancy must commence with an Additional Judge whose tenure has come to an end and has led to the vacancy."

Decision:

1. After stating the contentions of both parties, the court went on to hold the scope of judicial review was as held in Supreme Court Advocates-on-Record case. In this case, the court held:

Except on the ground of want of consultation with the named constitutional functionaries or lack of any condition of eligibility in the case of an appointment, or of a transfer being made without the recommendation of the Chief Justice of India, these matters are not justiciable on any other ground, including that of bias, which in any case is excluded by the element of plurality in the process of decision- making.

2. An Additional Judge cannot be said to be on probation for the purpose of appointment as a Permanent Judge. This position is clear from the fact that when an Additional Judge is appointed there may not be vacancy for a Permanent Judge. The moment a vacancy arises, the Chief Justice of the concerned High Court is required to send a proposal for appointment of the Additional Judge as a Permanent Judge along with material as indicated in para 13. The rigor of the scrutiny and the process of selection initially as an Additional Judge and a Permanent Judge are not different. The yardsticks are the same. Whether a person is appointed as an Additional Judge or a Permanent Judge on the same date, he has to satisfy the high standards expected to be maintained as a Judge. Additionally, on being made permanent, the effect of such permanency relates back to the date of initial appointment as an Additional Judge.

3. While making the recommendations for appointment of an Additional Judge as a permanent
Judge, Chief Justice of the High Court is not required to consult the collegium of the High Court. Additionally, there is no requirement of enquiry by the Intelligence Bureau. The Chief Justice while sending his recommendation has to furnish statistics of month-wise disposal of cases and judgments rendered by a Judge concerned as well as the number of cases reported in the Law Journals duly certified by him. Further information required to be furnished regarding the total number of working days, the number of days the concerned Judge attended the Court and the days of his absence from Court during the period for which the disposal statistics are sent.

4. At the stage of appointment of either as an Additional Judge or a Permanent Judge, the Union Minister of Law, Justice and Company Affairs is required to consider the recommendation in the light of such other reports as may be available to the Government in respect of the names under consideration. The complete material would then be forwarded to the Chief Justice of India for his advice. This procedure is not required to be followed when an Additional Judge is appointed as a Permanent Judge.

5. Unless the circumstances or events arise subsequent to the appointment as an Additional Judge, which bear adversely on the mental and physical capacity, character and integrity or other matters the appointment as a permanent Judge has to be considered in the background of what has been stated in S.P. Gupta's case (supra). Though there is no right of automatic extension or appointment as a permanent Judge, the same has to be decided on the touchstone of fitness and suitability (physical, intellectual and moral). The weightage required to be given cannot be lost sight of. As Justice Pathak J, had succinctly put it there would be reduced emphasis with which the consideration would be exercised though the process involves the consideration of all the concomitant elements and factors which entered into the process of consultation at the time of appointment earlier as an additional Judge.

6. There are certain other factors which would render the exercise suggested by the petitioners impracticable. Having regard to the fact that there is already a full fledged participative consultation in the backdrop of pluralistic view at the time of initial appointment as Additional Judge or Permanent Judge, repetition of the same process does not appear to be the intention.

7. It is not in dispute that Union of India is the ultimate authority to approve the recommendation for appointment as a Judge. The Central Government, as noted above, has stated that in view of the practice followed in implementing the memorandum, once the Government on being satisfied that a suitable candidate who was earlier appointed as an Additional Judge is suitable for appointment as a permanent Judge, the elaborate consultation has not been considered necessary. It is of significance to note that some of the Hon'ble Judges who were parties to the judgments relied on by the petitioners while functioning as a Chief Justice of India have not thought it necessary to consult the Collegium as is evident from the fact that from 1.1.1999 to 31.7.2007 in more than 350 cases the Collegium was not consulted. It means that they were also of the view that the practice/procedure was being followed rightly. Therefore, the plea that without consultation with the Collegium, the opinion of the Chief Justice of India is not legal, cannot be sustained.

8. But at the same time we find considerable substance in the plea of the petitioners that a person who is not found suitable for being appointed as a permanent Judge, should not be given extension as an Additional Judge unless the same is occasioned because of non availability of the vacancy. If a person, as rightly contended by the petitioners, is unsuitable to be considered for appointment as a permanent Judge because of circumstances and events which bear adversely on the mental and physical capacity, character and integrity or other relevant matters rendering it unwise for appointing him as a permanent Judge, same yardstick has to be followed while considering whether any extension is to be given to him as an Additional Judge. A person who is functioning as an Additional Judge cannot be considered in such ircumstances for re-appointment as an Additional Judge. If the factors which render him unsuitable for appointment as a permanent Judge exist, it would not only be improper but
also undesirable to continue him as an Additional Judge.